Assistant Commissioner Of Income Tax, Central Circle-25, Delhi vs Everest Distributions Private Limited

PER VIKAS AWASTHY, JUDICIAL MEMBER:

This appeal by the Revenue is directed against the order of Commissioner of Income Tax (Appeals), Delhi-29 [in short ‘the CIT(A)’] dated 15.10.2025, for Assessment Year 2019-20.

The appeal is time barred by 3 days. The Revenue has filed an application citing reasons causing delay in filing of appeal. After perusal of the same, I am satisfied that delay in filing of appeal is not intentional, the delay has been caused for the reasons stated in application which appears to be bonafide. Thus, delay of 3 days in filing of appeal is condoned and appeal is admitted for decision on merits.

Shri Manoj Kumar, representing the department submits that the assessment in the case of assessee for AY 2019-20 was reopened based on information collected during search u/s.132 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) in the case of Galaxy Group, Shri Pradeep Indira Prasad Agrawalla, Shri Deepak Agarwal and Shri Himanshu Verma on 17.11.2021. During the course of search, documents were seized which contained information that the assessee is one of the beneficiaries of accommodation entry of Rs.15,00,000/-. During the course of search, it was found that Shri Deepak Agarwal and Himanshu Verma were providing accommodation entries to large number of beneficiaries, through, sham entities managed and controlled by them. The ld. DR placed reliance on the recent decision of Tribunal in the case of ACIT vs. Bhawani Finvest P. Ltd. in ITA No. 6303/Del/2025 for AY 2020-21 decided on 25.03.2025 to contended that the Tribunal in a similar case, where the assessee who was allegedly beneficiary of the accommodation entries from the aforesaid persons, addition of Rs.2 crores u/s.68 of the Act was made by the AO, the Tribunal upheld the additions made by the Assessing Officer (AO).

Per contra, Shri Sunil Kumar Gupta, appearing on behalf of the assessee vehemently defending the impugned order and prayed for dismissing appeal of the Revenue. The ld. Counsel submits that the AO has made addition alleging that assessee has received accommodation entry of Rs.15,00,000/- from M/s. CEA Consultants P. Ltd. and paid comissions of Rs.45,000/- to M/s. SW Consultants P. Ltd. The CIT(A) has given a categoric finding that after examination of seized ledger, audited financials and bank statements it emerges that during Financial Year 2018-19, there were no transactions of such nature.

Both sides heard, orders of the lower authorities examined. In the present appeal, the Revenue prayed for reversing findings of the CIT(A) in deleting the addition of Rs.15,00,000/-u/s.69A of the Act on account of accommodation entry allegedly received by the assessee from M/s. CEA Consultants P. Ltd., a paper company controlled by Shri Deepak Agarwal for routing accommodation entries. The contention of assessee is that during FY 2018-19 there were no financial or banking transactions with M/s. CEA Consultants P. Ltd. The CIT(A) in para 5.4 and 5.5 of the impugned order has given a specific finding that examination of seized documents, audited financial and banking statement that during FY 2018-19 shows that there were no transactions with M/s. CEA Consultants P. Ltd., or M/s. SW Consultants P. Ltd. The Revenue has not been able to rebut above finding of fact by the First Appellate Authority. In the absence of any controverting material, I find no reason to disturb findings of the CIT(A), hence, the impugned order is upheld and appeal of the Revenue is dismissed.